Every once in a while I will hear some news that leads me to believe that the economy may be on the upswing.
From my own experience, it at least seems that deal flow is picking up.
Not only does there seem to be more to work on now, it also seems that the pipeline is not as dry as it was earlier in the year.
After a prolonged period of inactivity, it may be that businesses are starting to conclude that the worst of the economic crisis is over or, at least, that it is not going to get any worse so if a business has survived to this point, it is likely going to make it through the downturn.
However, it is relatively clear that, my own experience notwithstanding, the national economy continues to sputter. In early June, Statistics Canada reported that, following gains in April, employment decreased by 42,000 in May, led by further manufacturing losses in Ontario.
The national unemployment rate rose by 0.4 percentage points to 8.4 per cent, the highest rate in 11 years.
Since the employment peak of October 2008, employment has fallen by 363,000 or 2.1 per cent.
These trends in the national economy are necessarily felt in the legal community too, though perhaps with some lag time.
Further, I still get the odd call or e-mail from friends letting me know that biglaw firms continue to layoff associates (they seem to always be done on the extreme down-low).
The downturn could have had (and may yet have) any number of consequences for an associate.
At worst, one could have been laid off. At best, one could be busier than ever because s/he practises in an area of law that blooms in tough economic times.
There are all kinds of scenarios in between: perhaps partnership has been pushed off a few years because you’re not busy enough to produce the requisite numbers; or maybe you’ve been busy enough to keep your job and, at the same time, have been able to pursue interests outside of the office - that is, perhaps you have the perfect work/life balance going, which, if that is how you feel, may say much about how you will feel about your position as an associate once the balance again becomes skewed (or, rather, (ab)normalizes).
Given my own conflicting experiences of an increase in deal flow, the poor economic reports that StatsCan continues to deliver and the apparent continuing layoffs of friends and colleagues, how am I (how is any non-economist) supposed to properly determine where in this economic process we are?
More to the point, as an associate, how secure in your job do you currently feel?
If your firm has made a round of layoffs, are you confident that is the end of it?
Do you continue to sit at your desk and feel vulnerable as you try to at least appear busy?
Or have the layoffs meant that you’re now busier because there are now less people to lay claim to the work that is available (or maybe work beginning to pick up generally)?
As a tangible example for many associates, are you comfortable enough to take advantage of low interest rates (and an arguably repressed condo/housing market) to buy a condo or house?
For most associates, this is the first time in our professional career that we have been through a downturn.
It is a needed awakening to the fact that good economic times don’t last - like fashion trends, economic trends are cyclical.
The key for us is to ensure that we learn from our own experience in the current downturn, whatever that experience may be for each of us.
There will be another downturn within the span of our careers.
So, one must question: what will I do during the next economic bubble to ensure that when the subsequent downturn happens my own exposure will be minimized?
More to the point, how will I build my practice to ensure that I am seen as valuable (for the most part, this likely means how will I build a book of business)?
Because next time this happens your commitments may be significantly more than they are now: children (or, by then, young adult children that are in private school or university); a large mortgage; a car that costs more than you ever thought you’d spend on a house.
Our current experience has afforded us an opportunity to take stock of what is most important in our own respective lives and what we actually need to save and prepare for.
So, while in my view the current downturn continues, it is not too early to start thinking about what you will do to ensure that you do not fall victim to the next one.
Justin Mooney, who was called to the bar in 2002, is an associate who practises corporate/commercial law at Davis LLP. He can be reached at [email protected].
